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Unformatted text preview: mports automobiles, a capital‐intensive good. a. According to the Heckscher‐Ohlin theorem, is Russia capital abundant or labor abundant? Briefly explain. b. What is the impact of opening trade on the real wage in Russia? c. What is the impact of opening trade on the real rental on capital? d. Which group (capital owner or labor) would support policies to limit free trade? Briefly explain. 5. The following two equations describe a long‐run situation for prices and costs for the wheat and the cloth industry. Both industries...
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This note was uploaded on 10/06/2013 for the course EC 161 taught by Professor Fusillo during the Fall '12 term at Tufts.
- Fall '12